The effective closure of the Strait of Hormuz has triggered the biggest disruption to global energy supplies since World War II, cutting crude oil and refined product supplies by 20% and LNG supplies by 16%, according to S&P Global’s latest India Research Chapter report, India Forward: Reimagining Growth.

 

The shock has hit Asia hardest, particularly emerging and developing economies where oil, refined-product and gas reserves remain limited and economies have less capacity to absorb sudden price spikes.

 

India is among the countries most exposed to the disruption. More than half of the country’s crude oil imports transit the Strait of Hormuz, while the crisis has also disrupted supplies of crude, LPG and LNG.

 

Dave Ernsberger, President, S&P Global Energy, highlighted in the report that “The disruption to energy supplies through the Strait of Hormuz has been a severe test of energy security for high-growth Asia. India, which relies heavily on the Strait of Hormuz for oil, refined products, gas and adjacent supply chains, has faced reductions in crude and LPG of 20% and 12%, respectively, as well as a drop in LNG of 16%. Economic resilience and energy security are critical as India responds to this continuing supply shock.”

 

The report argues that the crisis has exposed vulnerabilities in Asia’s energy security and sharpened the case for diversified supply sources, integrated storage and strategic reserves for crude oil, refined products and, where feasible, gas.

 

For India, the findings point to an urgent need to strengthen supply chains and build greater resilience against external energy shocks.

 

The Hormuz disruption is also reshaping the debate around India’s energy transition. The report says the next phase will have to balance climate ambitions with the need for reliable, affordable and secure energy.

 

The crisis has reinforced the case for strengthening the power system as India rapidly expands renewable energy, with the key challenge being the ability to deliver clean and reliable electricity at scale.

 

India’s E20 programme is also taking on a broader strategic significance. The report says the fuel-blending programme has evolved from a policy mandate into a potential energy-security tool, although its long-term success will depend on ecosystem readiness and sustainable feedstock supplies as demand rises.

 

Despite external pressures, India’s economy grew 7.7% in 2025-26, significantly exceeding expectations amid high US tariffs and global uncertainty, according to the report.

 

Growth is projected to moderate to around 7.0% in 2026-27. S&P Global and Crisil say the stronger-than-expected performance highlights the resilience of India’s domestic economic drivers and its ability to navigate a more uncertain global environment.

 

The report also sees India continuing to position itself as a leading power, with its geopolitical strategy likely to combine compartmentalised cooperation with major powers and broader engagement with emerging economies.

 

The report identifies the digital rupee as another potential pillar of India’s digital infrastructure. It says the central bank digital currency could embed rules directly into money and, as the global economy becomes increasingly tokenised, help keep cross-border business-to-business trade and remittances anchored in sovereign currency rather than foreign-currency stablecoins.

 

India’s capital markets have also expanded substantially over the past decade. As of June 30, 2026, the country’s equity market had an investable market capitalisation of $2.03 trillion, reflecting the growing size and depth of the market.

 

The report notes that India combines strong economic growth with an expanding listed-equity universe spanning emerging domestic companies and globally competitive firms.

 

The India Forward report brings together seven original thought-leadership articles from analytical teams across S&P Global and Crisil, examining the opportunities and risks shaping India’s next phase of growth.

 

The chapters cover energy resilience, the power transition, E20 and energy security, economic growth, geopolitics, the digital rupee and India’s capital markets.